THOUSAND OAKS, Calif. — (BUSINESS WIRE) — August 2, 2018 — Teledyne Technologies Incorporated (NYSE: TDY):

• Record sales of $732.5 million, an increase of 9.1% compared to last year
• Record GAAP earnings per diluted share of $2.32
• Record operating margin
• Raising full year 2018 GAAP earnings outlook to $8.18 to $8.28, an increase from the prior outlook of $7.67 to $7.77

Teledyne today reported second quarter 2018 net sales of $732.5 million, compared with net sales of $671.1 million for the second quarter of 2017, an increase of 9.1%. Net income was $85.9 million ($2.32 per diluted share) for the second quarter of 2018, compared with $60.1 million ($1.66 per diluted share) for the second quarter of 2017, an increase of 42.9%. The second quarter of 2017 includes $4.0 million ($0.08 per diluted share) in acquisition costs related to the e2v technologies plc (“e2v”) acquisition.

“Teledyne’s second quarter results were the best in our history. We achieved all-time record sales, earnings, and operating margin,” said Robert Mehrabian, Chairman and Chief Executive Officer. “Organic growth of 8.3% was driven by broad-based growth across our imaging and instrumentation businesses. Orders also remained healthy with an overall book to bill greater than 1.1 times due in part to strong defense and space-related contract awards. Finally, margins increased in every segment as a result of greater sales, favorable product mix and cost control, as well as stronger business integration and simplification efforts across the company.”

Review of Operations

Comparisons are with the second quarter of 2017, unless noted otherwise. In the second quarter of 2018, we realigned the reporting structure for certain of our microwave product groupings. These products, acquired with the acquisition of e2v, were formerly reported as part of the Aerospace and Defense Electronics segment and are now reported as part of the Digital Imaging segment. Previously reported segment data has been adjusted to reflect this change. Total sales for these products were $24.2 million for fiscal year 2017.

Instrumentation

The Instrumentation segment’s second quarter 2018 net sales were $262.6 million, compared with $233.8 million, an increase of 12.3%. Second quarter 2018 operating income was $40.9 million, compared with $30.5 million, an increase of 34.1%.

The second quarter 2018 net sales increase resulted from higher sales of marine instrumentation, test and measurement instrumentation and environmental instrumentation, as well as the contribution from recent acquisitions. Sales of marine instrumentation increased $11.7 million and primarily reflected higher sales of sonar systems and interconnect products, partially offset by lower sales of sensors for energy exploration. Sales of test and measurement instrumentation increased $8.4 million. Sales of environmental instrumentation increased $8.7 million and included $5.3 million in incremental sales from a recent acquisition. The increase in operating income primarily reflected the impact of higher sales and favorable product mix.

Digital Imaging

The Digital Imaging segment’s second quarter 2018 net sales were $225.3 million, compared with $200.2 million, an increase of 12.5%. Operating income was $43.3 million for the second quarter of 2018, compared with $28.0 million, an increase of 54.6%.

The second quarter 2018 net sales primarily reflected higher sales of X-ray detectors for life sciences applications, machine vision sensors and cameras for industrial applications, and laser-based mapping systems. The increase in operating income in the second quarter of 2018 reflected the impact of higher sales and favorable product mix. Operating income in 2017 included $3.7 million in acquisition-related costs related to the e2v acquisition.

Aerospace and Defense Electronics

The Aerospace and Defense Electronics segment’s second quarter 2018 net sales were $173.5 million, compared with $161.1 million, an increase of 7.7%. Operating income was $33.7 million for the second quarter of 2018, compared with $29.2 million, an increase of 15.4%.

The second quarter 2018 net sales reflected $12.6 million of higher sales of defense electronics, partially offset by $0.2 million of lower sales of aerospace electronics. The higher sales of defense electronics reflected greater sales in most product categories. The increase in operating income in the second quarter of 2018 primarily reflected the impact of higher sales.

Engineered Systems

The Engineered Systems segment’s second quarter 2018 net sales were $71.1 million, compared with $76.0 million, a decrease of 6.4%. Operating income was $7.4 million for the second quarter of 2018, compared with $7.7 million, a decrease of 3.9%.

The second quarter 2018 net sales reflected lower sales of $1.6 million of engineered products and services, $1.1 million of energy systems products and $2.2 million of turbine engines. The lower sales of engineered products and services primarily reflected decreased marine manufacturing programs partially offset by increased sales related to missile defense. Operating income in the second quarter of 2018 decreased slightly, due to lower sales.